Insights

In the case of McFarland v Gertos [2018] NSWSC 1629, Bill Gertos had occupied the vacant 6 Malleny Street, Ashbury since 1998 and then applied in 2017 to be registered as its owner pursuant to the legal doctrine of adverse possession.

Adverse possession occurs when a person possesses land in a way contrary to the legal interests of the rightful owner, such as squatting. In rare circumstances, such a person may eventually become entitled to ownership of the property.

Despite the arguments of the deceased former owner’s descendants, Mr Gertos was able to prove that he had maintained continual possession of the property well beyond the twelve year limitation period that applies to adverse possession claims.

Therefore, he was able to become the registered owner of the property despite never having actually bought or rented it.

Background

The original owner was Henry Downie, who died in 1947. At the time a Mrs Grimes rented the property from Mr Downie. She continued renting the property up until her own death in April 1998, after which the property was emptied. Soon after, Mr Gertos noticed that no one lived in the property and moved in himself.

Over time Mr Gertos changed the locks, made improvements and renovations and then rented the property out to tenants, collecting the rent from an appointed agent.

Having carried on these activities for over 12 years, Mr Gertos then applied to the Court to be registered as the owner of the property.

Under the law of adverse possession, possessing a property uninterrupted for 12 years allows a person to become the registered owner.

Decision

The descendants argued, among other things, that they were entitled to the property through intestacy (as Mr Downie had died without having left a valid Will), and that Mr Gertos did not have the required intention to possess the property

The Court rejected the descendant’s arguments, saying that Mr Gertos’ conduct suggested otherwise. Having spent money on the property and by changing the locks, paying the bills and continuously renting out the property, Mr Gertos had shown the required intention to possess. Further, his possession was sufficiently open (in the sense of being public), that the Court found itself unable to deny his claim, even though the neighbours had never met or seen Mr Gertos.

Accordingly, Mr Gertos was able to be registered as the owner of the property.

Takeaways

This decision attracted a lot of media attention and anger from the public. However, to succeed in an adverse possession claim is incredibly rare.

Firstly, a person is required to have openly possessed a property uninterrupted and against the rights of the rightful owner for at least 12 years.

Secondly, an applicant requires statutory declarations by several disinterested people who concur with the facts put by the applicant in seeking to make their claim.

Thirdly, notice must be given to neighbours of the intention to make an application.

Lastly, the local Council must usually provide a statement regarding certain matters, a surveyor must be engaged to prepare a survey of the land and probate and land searches must usually be undertaken.

In this case the necessary factors happened to fall in favour of Mr Gertos.

This article was written by lawyer Kyle Bridge.